BILL NUMBER: AB 565 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY MARCH 26, 2015
INTRODUCED BY Assembly Member Cooley
FEBRUARY 24, 2015
An act to amend add and repeal
Section 10191 of 10191.5 of the
Insurance Code, relating to insurance.
LEGISLATIVE COUNSEL'S DIGEST
AB 565, as amended, Cooley. Insurance contracts.
Interstate Insurance Product Regulation Compact:
independent study.
Existing law provides for the regulation of insurers and specified
insurance products, including life insurance, disability insurance,
and long-term care insurance, by the Insurance Commissioner. Existing
law directs the Insurance Commissioner to enforce the execution of
laws regulating the business of insurance.
This bill would require the commissioner to commission an
independent study to examine the extent to which the uniform
standards set forth in the Interstate Insurance Product Regulation
Compact provide consumer protections that are equivalent to those
established under state law for annuity, life insurance, disability
income, and long-term care insurance products, and would prohibit the
use of General Fund or Insurance Fund moneys for this purpose. The
bill would require the commissioner to submit the report to the
chairpersons of the Assembly and Senate Committees on Insurance no
later than January 1, 2017.
Existing law authorizes the Insurance Commissioner to promulgate,
from time to time as conditions warrant, after notice and hearing,
reasonable rules and regulations, and amendments and additions to
those rules and regulations, as are necessary or advisable in order
to establish and maintain a procedure for the filing and approval of
specified documents prior to their issuance, delivery, or use in this
state.
This bill would make technical, nonsubstantive changes to this
provision.
Vote: majority. Appropriation: no. Fiscal committee: no
yes . State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 10191.5 is added to the
Insurance Code , to read:
10191.5. (a) (1) The commissioner shall commission an independent
study to examine the extent to which the uniform standards set forth
in the Interstate Insurance Product Regulation Compact developed by
the Interstate Insurance Product Regulation Commission provide
consumer protections that are equivalent to those established under
state law for annuity, life insurance, disability income, and
long-term care insurance products.
(2) The report shall, to the extent feasible, also highlight the
substantive differences between the uniform standards set forth in
the Interstate Insurance Product Regulation Compact and the statutory
requirements under state law for annuity, life insurance, disability
income, and long-term care insurance products.
(b) (1) The commissioner shall submit the report to the
chairpersons of the Assembly and Senate Committees on Insurance no
later than January 1, 2017. The report shall be made in compliance
with Section 9795 of the Government Code.
(2) The commissioner shall have the right to review and approve
the final report prior to its submission to the Legislature.
(c) This section shall be implemented only to the extent that
solicited nonpublic funds are received and made available for the
commission of the independent study. No General Fund or Insurance
Fund moneys shall be used to implement this section.
(d) This section shall remain in effect only until January 1,
2021, and as of that date is repealed, unless a later enacted
statute, that is enacted before January 1, 2021, deletes or extends
that date.
SECTION 1. Section 10191 of the Insurance Code
is amended to read:
10191. (a) The commissioner may, from time to time as conditions
warrant, after notice and hearing, promulgate reasonable rules and
regulations, and amendments and additions to those rules and
regulations, as are necessary or advisable, to establish and maintain
a procedure for the filing and approval of documents, as defined in
this section, prior to their issuance, delivery, or use in this
state, in lieu of the requirements of submission, filing, or approval
for the documents presently provided in Section 10205, 10205.5,
10205.6, 10225, 10270, 10270.1, 10270.57, 10270.9, 10270.91,
10270.92, 10270.93, 10290, 10292, 11066, 11069, or 11658. For
purposes of this section, "document" includes, but is not limited to,
every form of contract, insurance policy, application, rider,
endorsement, amendment, insert policy page, certificate, or other
evidence or notice of insurance, fill-in material, schedules of rates
and classifications of risks, and any modification to any document,
which is subject to the requirements of any of the sections described
in this subdivision.
(b) Any rule or regulation shall be promulgated in accordance with
the procedure provided in Chapter 3.5 (commencing with Section
11340) of Part 1 of Division 3 of Title 2 of the Government Code.
(c) In promulgating any rule or regulation, the commissioner may
give consideration to the following circumstances:
(1) Whether all documents, the submission, filing, or approval of
which is governed by any of the sections described in subdivision
(a), or only a portion of those documents described in the rule or
regulation, shall be subject to the rule or regulation.
(2) Whether certain documents or portions of those documents
should be regulated in respect of submission, filing, or approval in
a fashion differing from similar requirements applicable to other
documents.
(3) Whether varying procedures may be made applicable among
admitted insurers in respect of the submission, filing or approval
predicated, in whole or in part, upon the following factors: (A) the
age and size of the submitting insurer, (B) the period of its
licensing in this state for the class or classes of insurance
represented by the documents, (C) the nature and number of prior
submissions of similar documents and the disposition of those prior
submissions by the commissioner, (D) and similar criteria that is
relevant to a determination that the submitting insurer has
demonstrated compliance with all applicable statutes, rules, and
regulations relating to documents comprising prior submissions.
(d) In promulgating any rules and regulations, the commissioner
shall, so far as practical, describe or define certain provisions:
(1) that the commissioner will authorize without review when
accompanied by a certification prescribed by him or her by rule, and
(2) that the commissioner will under no circumstances approve.
(e) The commissioner shall establish a period of time, not shorter
than one year, during which any change in the provisions that
pursuant to subdivision (d), he or she has provided he or she will
under no circumstances approve, will not apply to policies filed
prior to the effective date of the change.
(f) Except as otherwise provided in this section, any document
approved by the commissioner pursuant to rules and regulations
authorized by this section may have its approval withdrawn in
accordance with subdivision (d) of Section 10291.5 or Section 12957,
whichever is applicable.